The Hidden Cost of Free Project Management Software

Even small projects can become complex and require a lot of management oversight. The project manager needs to oversee costs, schedules, and resources, as well as track changes, monitor risks, and report on progress.

Trying to handle all of this with a simple spreadsheet can be time-consuming and lead to errors, delays, and frustration. So it’s no wonder that many people turn to project management software.

There are a lot of free project management software options on the market today. At first glance, these may seem like the natural choice for individuals, startups, and small businesses. After all, what’s the harm of trying out something that’s free? Especially if you’re not yet sold on whether or not you even need project management software?

Unfortunately, nothing is ever entirely free.

Any so-called “free” tool for project management is going to have some hidden costs. For medium and large companies, or companies expecting to grow, these costs can be even higher.

Read on to discover the top 5 hidden costs of free project management software. But first, let’s clarify the different types of “free” options on the market.

Four types of free tools for project management

Open source. Open source tools are free to download, alter, copy, and redistribute under license. These tools are created and managed by volunteer communities and are not tied to one vendor or supplier. Open-source software may be repackaged by premium vendors as paid software packages.

Freeware. These free project management softwares are owned by a company or individual. They are still free to download, but cannot be altered, copied, or redistributed.

Shareware. Shareware tools offer free trial periods, but then require a small fee to continue using.

Freemium. Freemium software is offered by popular vendors as a starter package to attract new customers. Freemium versions are limited versions of premium software and offer you the possibility to get to know a tool, familiarize yourself with it, and discover its potential.

5 hidden costs of free project management software

#1 - One size fits all

Except for open source software, free software for project management cannot be customized. Even if you do select an open source tool, customization will be labor intensive and complex. You will need someone in-house who has the skills and knowledge to customize and maintain the software, which results in labor costs.

You also won’t be able to adapt the tool to align with your workflows, processes, and organizational structures. This can cause headaches with reviews, approvals, and security.

You may even find yourself having to change your business to suit the tool, which can make adoption much more difficult and create inefficiencies in your company.

If your team doesn’t want to use the software, it can lead to even more problems. For example, it can result in not having enough data in the system, not getting updates on time, and having to chase people for information.

An advantage of project management software is its ability to provide real-time insights into the status of the project. This can enhance communication and improve decision making. However, what if your software can’t provide the reporting views that management wants to see? What if it doesn’t even offer a reporting capability?

You will be forced to go without, or to create these reports outside of the system, which requires more time and effort. Trying to force a tool to do something it wasn’t designed for, or having to create a workaround to adapt it for your business, can result in you being less productive than you were before.

#2 - Inability to grow with your business

Most free tools for project management only provide you a limited solution. Plans are often restricted to a limited number of users, projects, and data. They may also exclude certain features and capabilities.

There are also common limitations around APIs and integrations. The ability to pass data to and from other key business solutions is one of the most important project management features.

For example, what if your marketing asset management, automation, and analytics are all handled in separate tools? If you can’t integrate them with your project management software, you will be forced to make due with a fragmented view of your marketing campaigns, or enter the data into the tool manually.

This lack of integration creates the following risks:

Delays. There will be delays in updating the information from one system to the other.

Errors. Since the information has to be manually entered, it increases the risk of the data being input incorrectly.

Disparity. Different platforms will contain different information. Getting a full picture of your initiatives will require painstakingly piecing data together across systems.

Confusion. Mistrust and confusion arise when different systems provide different information.

Connecting your project management platform with other business tools to streamline information flow is critical as your organization grows and adopts more tools. The inability to do this with the free software means that you will be forced to change tools eventually. This rings especially true for enterprise teams, who need the best project management software available to adapt to growing business needs.

When you reach your size limits, or realize you need additional capabilities, you’re faced with either upgrading or having to transition to a new project management software. This can cause headaches with the configuration as well as data transfer. It can result in lost historical information and the inability to view trends.

We often fool ourselves into thinking we can make do with the free version forever. Then, when the free version is no longer meeting our needs, we’re hesitant to switch to another tool because our users are already trained on this one, it’s familiar, it’s configured, and our data is already in it. This unwillingness to change can lead to investing in a premium tool at a higher cost than similar paid options on the market.

#3 - Task management, not project management

While many options on the market are called free project management tools, they are often designed to work as fancy “to-do” lists. These tools only offer a few select features and are built for task management rather than project management.

They may work okay for creating and tracking specific tasks, but this is a myopic view and a small part of project work. This type of tool does not allow you to easily see how tasks connect.

Without functionality such as the ability to create predecessors and successors, you cannot view and manage dependencies or the critical path. In other words, when one task slips, it can be incredibly difficult to understand the impact on the overall project.

Without a project management timeline, it can be more difficult to coordinate resources and tasks that are interdependent and to make sure resource loading is done properly. For instance, let’s say you have 6 tasks assigned to Sally, and 10 assigned to Bobby, all due by the end of next week. Who has more capacity?

You may assume it’s Sally, but what if each of her tasks takes twice as long as each of Bobby’s? It’s impossible to answer the question with a simple task management tool. Which means it’s impossible to know who is overworked and who has free time to help, without working outside of the system to find out.

The best project management software should support risk and change management, project analysis and reporting, and decision making. It should help provide an overview of the project, which task management software can’t do.

#4 - Lack of training and support

Most paid project management solutions come with training and support through the form of dedicated customer success managers, support teams, and/or professional services teams. A warranty period and ongoing maintenance are also standard offerings.

Vendors of paid software want to keep you as a satisfied customer, so they make sure you're set up for success. They’re willing to help you customize the tool to your team's unique needs, and help solve typical issues you may have in record time. They also offer regular upgrades, maintenance, and patches as they improve the software.

Free solutions obviously aren't equipped to offer this same level of service. Creators of free software are not invested in whether or not you succeed, as it doesn’t benefit them either way.

Without support and training, the costs for all the upfront time, effort, and expense to train your staff and configure the software will be coming out of your pocket. If you run into a bug or issue, you’ll have to search for the solution and test the fixes. This means time dealing with the software that could have been spent working on projects or otherwise growing your business.

People sometimes claim that one of the benefits of open source software is the support from a large user community. However, the sheer volume of conflicting information can be overwhelming and frustrating.

#5 - Security risks

Your project management software is going to be a repository for considerable company information. Even without integrating to other management systems, over time your software will hold a significant amount of data, including:

Customers you’ve worked with

Profit margins on projects

Internal and external costs

Labor and resource data

Trends over time

It could also include lessons learned, projects you’re currently trying to win, and other sensitive information such as payroll. It’s important to consider who you’re entrusting with this information and how safe it is going to be.

Data security. Are you relying on someone else to store your project data for you? If it’s lost, will you have a back-up? If it’s a small or relatively unknown company, what happens if it ceases operations? You could end up losing all your current and historical project data.

(Meta)data exposure. It’s important to consider why the tool is free and what the provider is gaining in exchange for access to your data. Are they gaining access to your company, customers, or other sensitive information that you don’t want to share?

Security breaches. Even cloud-based and open source software, which is enterprise and community driven and developed, may be at risk for security hacks; especially if security patches are not regularly maintained. How will your free software protect your data from being stolen?

Some questions you should ask are:

Does the company undergo third-party verification of its security and controls?